Though Venezuela downplayed earlier Russian reports that it is about to buy submarines, Rosoboronexport Company, Russia's state agency for arms exports, has indeed been conducting talks with Venezuela on the delivery of five Kilo class diesel-electric submarines with missile systems.

Innokenty Naleto, advisor to the managing director of the Rosoboronexport made this known at a news conference on Sunday discussing the results of the third St. Petersburg international naval show.

In an interview with news agency Itar-Tass, Naleto said "the talks proceed at a high pace. We have made a big headway to signing a contract." According to the Rosoboronexport representative, Venezuela already requested a feasibility report on Kilo submarines and displayed interest in a number of other development studies of Russian submarine shipbuilding, displayed at the show, including small submarines from the Malakhit design office.

"Out of all delegations, we worked most closely precisely with Venezuela. They visited virtually all displays as well as enterprises. They had a separate program," Naletov continued. "They worked on a broad range of both aircraft and land hardware, but if we are to speak about the naval component, the most substantive talks were conducted on submarines of the Kilo class."

The representative said, "it is too early to speak about a sum and specific dates for concluding contracts Ð a sum at the pre-contract stage is a commercial secret."

Diesel submarines of the Kilo class, developed by the Rubin central design office and built by the Admiralteiskie Shipyards were supplied for export since 1986. The last big batch of ships of this class Ð eight submarines Ð was delivered to the Chinese navy. This class is regarded one of the best series in world submarine shipbuilding.

These subs are described as being "distinguished for their low noise, a reasonable degree of automated control over means of movement, weapon systems, powerful missile and torpedo as well as mine ammunition, good living conditions for personnel and are simple in servicing.